Are there profitable hedge funds using AI?
High-frequency trading is where you see it being used, essentially, decision-making algorithms analyzing and making transactions in microseconds.  It accounts for a significant percentage of market activity, and has been considered a source of greater market volatility (See: Flash Crashes).

You can bet that hedge funds are evaluating every form of AI for trading and predicting market trends in general, but, unlike academics (and a segment of the tech sector) I doubt they consider it in their interests to publish methods which competitors could then utilize.    

It's difficult to source information on exactly what is being looked into and utilized in the financial sector because there is a lot of marketing noise (exaggerated claims, 
 unreliable sources) but I did find these articles: 

Will AI-Powered Hedge Funds Outsmart the Market? (Tech Review; 2/4/2016)
"AI Hedge Fund Is Said to Liquidate After Less Than Two Years (Bloomberg; 9/7/2018)"

My gut tells me that Machine Learning methods will surpass humans in these kinds of decisions before too long (educated guess), and only increase in utility as the dataset these algorithms draw from grows, because it's ultimately a statistical problem.



AI is related to Game Theory, the study of economic decision-making, in the context of utility.  Game Theory might be said to have had its greatest success in computing in general, via minimax, but has traditionally been much harder to apply in real world economics.  Minimax can be utilized in machine learning, and it's actually hard to think of any economic decision-making that wouldn't utilize it in some form.